In a landmark moment for digital finance, the global neobanking sector has surpassed 300 million active users, signaling the end of traditional banking’s unchallenged dominance. This explosive growth, fueled by tech-savvy millennials and Gen Z consumers who now represent 78% of the user base, comes as legacy giants JPMorgan Chase and Citigroup pivot aggressively into the digital arena. Chase is rolling out its digital-only retail bank in key European markets, while Citi is unveiling a suite of AI-powered, branchless platforms to redefine consumer and corporate banking. These moves underscore a seismic shift: neobanks are no longer disruptors—they’re the new standard.
The Neobank Boom: From Niche to Mainstream
The neobanking revolution has accelerated dramatically since the pandemic, with global user numbers rocketing from 146 million in 2021 to over 300 million active accounts by late 2024. Projections for 2025 paint an even rosier picture, with estimates ranging from 350 million to a staggering 394 million users worldwide. This milestone isn’t just about numbers; it’s a testament to neobanks’ appeal in delivering frictionless, low-cost services via mobile apps, sans the overhead of physical branches.
Leading the charge are behemoths like China’s WeBank, which boasts 399 million customers as of 2023—making it the world’s largest digital bank by user count. Tencent-backed WeBank leverages facial recognition and big data analytics to serve hundreds of millions of users, primarily in underserved segments. In Latin America, Brazil’s Nubank has crossed 100 million users, capturing 32% market share with its no-fee model and instant credit access. Europe’s Revolut, now at 60 million users across 48 countries, reported £1.1 billion in pre-tax profits for 2024, while U.S. player Chime hit profitability in Q1 2025 with 20 million accounts.
| Top Neobanks by User Base (2025 Estimates) | Users (Millions) | Key Markets |
|---|---|---|
| WeBank | 399+ | China |
| Nubank | 100+ | Latin America |
| Revolut | 60 | Europe/Global |
| Chime | 20+ | U.S. |
| Monzo | 12 | U.K./Global |
The sector’s transaction volume hit $4.96 trillion in 2023 and is projected to exceed $6.37 trillion in 2024—outpacing Japan’s GDP. Yet challenges persist: 80% of neobanks remain unprofitable, prioritizing user acquisition over margins. Innovations like AI-driven personalization and embedded finance are closing the gap, with 47% CAGR expected through 2030, pushing market valuation past $1 trillion.
Traditional Titans Enter the Fray: Chase’s Digital Gambit
JPMorgan Chase, the U.S.’s largest bank by assets, is betting big on digital to capture this wave. Building on its successful U.K. launch in 2021—which now serves 2.5 million customers and £15 billion in deposits—Chase announced plans to debut its fully digital retail bank in Germany in Q2 2026. Headquartered in Berlin, the platform will start with high-yield savings accounts before expanding to loans and payments, targeting millennials with “digital-first, simple, and rewarding” features.
This isn’t Chase’s first rodeo; its earlier U.S. digital experiment, Finn, flopped in 2019 due to integration issues. Lessons learned: The U.K. model emphasizes low overheads and 24/7 support, achieving break-even two years ahead of schedule in 2025. “Chase is designed for how people want to bank today,” said Daniel Llano Manibardo, head of Chase Germany. With 84 million U.S. consumers already in its ecosystem, this European push could add millions more, blending Chase’s trusted brand with the agility of a neobank.
Chase’s broader digital strategy includes AI enhancements through its LLM Suite, which generates investment decks in seconds and aims to achieve a “fully AI-connected enterprise” by 2030. Investments in mobile P2P payments—used by 67% of surveyed consumers, up from 40% in 2020—further position it to woo Gen Z, who show 39% interest in AI financial advisors.
Citi’s Branchless Ambition: AI at the Core
Citigroup, meanwhile, is launching “CitiDirect Commercial Banking” as its flagship digital-only brand for mid-sized corporates, now covering 57% of its global client base across eight countries, including the U.S., U.K., and Brazil. Rolled out in 2023 and enhanced in 2025 with AI for real-time insights and KYC automation, it offers a “single front door” to cash management, FX, and trade finance—eliminating siloed legacy systems.
For consumers, Citi is introducing Citi Shop, a browser extension for instant savings on 30+ categories, and Citi Pay, an embedded POS financing tool that approves purchases in seconds. These branchless innovations target “change-makers” with global lifestyles, backed by a reenergized brand platform. Chief Marketing Officer Alex Craddock’s overhaul includes genAI for personalized content and unified wealth services, aiming to boost engagement among fragmented audiences.
Citi’s crypto pivot adds edge: A 2025 digital assets unit will launch custody services early next year, enabling tokenized deposits and blockchain-based flows. With $18 billion in annual tech spend, CEO Jane Fraser envisions Citi as a “crypto supremacy” leader, processing massive cross-border volumes transparently.
The Bigger Picture: Convergence and Competition
As neobanks eclipse 300 million users, Chase and Citi’s entries signal convergence: Traditional banks adopting digital wrappers to stem deposit flight, while neobanks eye profitability through diversification. Millennials’ 75% adoption of P2P and 70% preference for app-based accounts amplify this trend, but regulatory hurdles—such as Europe’s open banking mandates—could level the playing field.
For consumers, the winners? Lower fees, faster services, and AI smarts. For the industry, it’s a $3.9 trillion pie up for grabs, with neobanks claiming just 5% share but growing 50% annually. As Revolut’s Nikolay Storonsky eyes a U.K. banking license and Nubank expands in Mexico, 2025 may mark the year digital finance goes truly borderless.
